The new Uganda Airlines takes shape
By Benjamin Mukose
What started as a pipe dream some years ago is slowly coming to reality. The idea of reviving Uganda Airlines has over the last few months picked pace and gained momentum with all the key requirements seemingly falling in place. Monica Ntege Azuba, the Works & Transport minister, has said the revived airline is expected to make its first flight by December this year.
According to Paul S. Dempsey, professor of law and director emeritus, McGill University Institute of Air and Space Law, Canada, a successful airline must have core fundamentals in place. Key among these include equipment, routes, the right human resource, financing and a management & operational plan.
Azuba told journalists recently that as far as equipment is concerned, government has already placed orders for six aircrafts: four bombardier CRJ 900 series from Canadian aircraft maker, Bombardier and two Airbus A330-200 series from French plane maker, Airbus. This choice of equipment seems to be informed by the need to operate cost-effective vessels and the targeted routes.
According to a feasibility study for the revival of Uganda Airlines conducted by the National Planning Authority (NPA) and Uganda Development Corporation (UDC), one of the major problems attributed to the collapse of the air company previously was bad choice of aeroplanes that were expensive to run and maintain. One of the key recommendations of the study is that in the revival of Ugandan Airlines, informed and wise choice of adept but easy to manage equipment must be made.
Bombardier seemed to be the easiest destination for this purpose. The Canadian company recently reported that their equipment is catching the eye of the African market because of its cost-effectiveness.
“With the lowest overall cost and highest reliability standard, the CRJ Series and Q Series aircraft are low-risk investments for airlines looking at increasing profitability,” David Speirs, Bombardier Commercial Aircraft’s vice president, asset management, said.
Adding to Speirs’ voice, Jean-Paul Boutibou, the company’s vice president, sales, Middle East and Africa, said: “We have successfully placed a significant number of pre-owned regional aircraft with more than seven airlines from the [African] region in the last three months.”
The Infrastructure Magazine has established that other airlines in the region that have recently placed orders for the Bombardier CRJ and Q series equipment include Kenya’s DAC East Africa and Silverstone Airways, Congo Airways, among others.
Airbus A330-200 is dubbed by its manufacturers as “the versatile mid-sized wide body”. Airbus A330-200 is a modern design craft known for its comfort and modern efficiency features suitable for long distance flights.
The NPA and UDC study recommended that for economic viability, the new Uganda Airlines needs to start with regional flights and international routes.
Its routes also determine the profitability of any airlines. High-value the routes generate better revenues for the company. Azuba told journalist the new Uganda Airlines would start with international and regional flights.
“The four (bombardier) aircraft will be in operation within the region, and that includes Kenya and all other countries we have bilateral agreements with,” she said.
For the international routes, The Infrastructure Magazine understands that government has tasked the ministry of Foreign Affairs to engage with concerned foreign governments to ensure the old routes of the old Uganda Airlines are restored. This will essentially mean that routes to Western Europe – London, Rome and Brussels – are the likely initial destinations.
The NPA/UDC study did not recommend immediate start of local flights. However, the company is working out an arrangement whereby it will carry international passengers to Entebbe. If they need further internal connecting flights, those passengers will be passed on to local operators such as Eagle Air.
This magazine has also been informed that the new Uganda Airlines will run its own handling services at its hub in Entebbe. Currently Enhas, a private company, does all ground handling services at Entebbe International airport. Uganda Airlines will do its own handling, and will not seek to offer its handling services to other airlines in the short term. Aviation experts say ground handling is also a good source of revenue for airlines. That is why Kenya Airways and Ethiopian Airways do their own handling in their hubs in Nairobi and Addis Ababa respectively.
The other critical element in operating an airline is the experienced and skilled workforce to do its operation and management. Azuba told the media that decisions to put in place a critical human resource have already been made. A few highly experienced skills will be headhunted from the international market, while the other general skills will be sourced locally.
Recently when Kenya Airways was restructuring following the last 5 year debacle that almost brought it to its knees, the company hired McKinsey & Company, an American worldwide consulting firm, to prepare a turnaround strategy. One of the areas of focus was human resource. Under this plan, Kenya Airways recruited Polish Sabastian Mickosz as its new CEO. Mickosz is known to have turned around a collapsing Polish Airlines. Uganda will most likely learn from this and try to recruit a CEO with relevant experience.
Management and operational pans are as important in the airlines industry as the people. Without a plan, there is no business. The NPA/UDC report acknowledges as much. One of the outputs of the feasibility study was the design of the operation and management framework for the new airlines. Azuba said the plan is in place for the short, mid and long-term.
Government, through UDC, will provide at least US$ 1 billion in the initial stages, but the company will eventually list on the stock exchange. It is understood that government is currently discussing with some foreign investors who will take a stake in the national flyer.